24f

• Board Meeting Date: 3/24/2003
• Description: CF Section - Town of Coal Creek
• Board Meetings - Doc Type: Memo

Town of Coal Creek Agenda Item 24f.
March 24-2625, 2001
Water Riahts
Coal Creek owns a 1 CFS water right out of the "Coal Creek Pipe", with a priority date of 1884. The
average annual total diversions for this water right have been 90 acre-feet, for the period 1971-1994.
This water right was out of priority for portions of 1977, 1978, and 2002.

The Town of Coal Creek
The Town of Coal Creek is a Colorado municipal corporation with the authority to set water rates,
issue debt, and provide services in accordance with the laws of the State of Colorado. The Town is
subject to the provisions of TABOR and plans to repay the CWCB loan using revenues from its water
enterprise fund.

Proiect DescriDtion
Three alternatives were analyzed in the feasibility study:

1. The no-action alternative.
2. Purchase sufficient Union Ditch and Fremont County Ditch shares to satisfy the Town's
existing water need of 34 acre-feet consumptive use.
sufficient Union Ditch shares to satisfy the Town's existing water need of 34
acre-feet consumptive use.

Alternative 2, Purchase sufficient Union Ditch and Fremont County Ditch shares to satisfy the Town's
existing water need of 34 acre-feet consumptive use, was ruled out because the consumptive use per
share from the Fremont County Ditch has not been established in water court. It could take up to 10
years to obtain such a ruling, with uncertain outcome. Alternative 3, Purchase sufficient Union Ditch
shares to satisfy the Town's existing water need of 34 acre-feet consumptive use, is the preferred
alternative. Union shares have been transferred to municipal use in the past. Each share produces
approximately 1.25 acre-feet, of which 270/0 is allowable consumptive use. The no-action alternative
is unacceptable since it means the Town's water rights will be out of priority during dry years, most
likely including the present year.

Selected Alternative 3 involves purchase of up to 100 shares of the Union Ditch Company. 100
shares equates to approximately 125 acre-feet, of which 270/0, or 34 acre-feet is allowable
consumptive use. Coal Creek's current annual water need is 34 acre-feet, consumptive use.

The cost of Union Ditch shares is in the range of $600 to $750 per share such that the cost of 100
shares would be in the range of $60,000 to $75,000.

Financial Analvsis
The high estimated cost of the water rights purchase is $75,000. Staff recommends a Small Project
loan from the Construction Fund in amount of $67,500, which is 90 percent of the total cost. The
Town will fund its 100/0 from existing cash reserves.

Water is used for municipal purposes and the Town of Coal Creek has a Median Household income
that is less than 800/0 of the statewide average. The CWCB municipal "low income" rate of 3.750/0 for
30 years would apply to this loan.

Table 1 is a summary of the financial aspects of the project. A CWCB loan of $67,500 would have an
annual payment of $4, 165 (including the 100/0 reserve requirement.) This payment would be made
from current net income so that the monthly water bill would not increase.

Table 1. Town of Coal Creek - Financial Summary

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